Posts Tagged 'Startup Accelerator'

In this interview, SoftLayer’s community development lead in Canada, Qasim Virjee, sits down with Marcus Daniels, the co-founder and CEO of HIGHLINE, a venture-backed accelerator based in Vancouver and Toronto.

QV: Y Combinator has become an assumed standard for accelerators by creating its own business model. What do you think is both good and bad about this?

MD: Y Combinator (YC) not only created a new model for funding tech startups, but it also evolved the whole category. Historically, I like to think that Bill Gross's Idealab represented accelerator/incubator 1.0 and YC evolved that to 2.0 over the past decade, resulting in a hit parade of meaningful startups that are changing the world.

The good is that YC has created a “high quality” bar and led the standardization of micro-seed investment docs for the betterment of the whole startup ecosystem. It proved the model and has helped hundreds of amazing founders with venture profile businesses that are changing the world.

The bad is that there are now thousands of accelerators/incubators globally running generic programs that don't help founders much. More than half have a horrible rate helping startups raise follow-on capital and almost all never had a single exit from a startup they invested in.

HIGHLINE has a strong track record in our short history and now sees a big opportunity to be amongst the leaders in the evolution of the accelerator industry.

QV: Many accelerators focus on streamlining a program to process cohorts of companies at regular intervals throughout the year, every year. Often, the high throughput these programs expect means they must select companies from applications, rather than the approach you seem to be taking. Can you explain how HIGHLINE is sourcing companies for investment?

MD: HIGHLINE gets over 800 applications a year and targets about 20–30 investments during that time. Out of our last 12 investments, all had either come from referral partners or the team hunting the best founders to be part of our portfolio. Over the years, we have moved from the ideation stage, which comprises the majority of inbound applications, to the MVP in market stage, which is our sweet spot now. We will also focus on low-volume, high-touch advisory support, which is why a lot of time is spent building relationships with founders and adding value to MVP-stage startups before investing helps curate better deals.

QV: Traditionally, investment vehicles (such as VC firms and accelerator programs) have been run by financial industry types, but it seems that you are taking a more entrepreneurial approach with HIGHLINE and constantly evolving your business model. What can you tell me about this?

MD: The best accelerator leaders globally are past entrepreneurs who have some investment experience given how hands-on you have to be with the companies. Without the experience of starting and growing ventures, it is really hard to help tech founders navigate the daily challenges. Also, the best founders get to choose, and they want to work with other top founders in a long-term mentor/advisory/coaching relationship.

QV: How does being “VC-backed” differentiate HIGHLINE from other accelerators?

MD: Having several VCs as investors, such as the BDC and Relay Ventures, gives us an edge in several ways. Firstly, they are not only a great quality referral network for deals, but also a huge help in getting our companies venture-ready—even if they may not invest directly. Secondly, they allow us to internally focus on a specialization in helping venture profile businesses raise follow-on capital, as opposed to the glut of programs that are optimized for entrepreneurial education and lifestyle job creation. Lastly, they put big pressure on the whole HIGHLINE team to both get results for shareholders and build something unique that can be a category leader over the next decade.

QV: Our country is physically large and this seems to have created differentiated tech startup scenes between its cities. How does HIGHLINE collapse the geographic divide by having a physical presence in both Vancouver and Toronto?

MD: HIGHLINE tries to curate and unite the best digital founders, institutional investors, and ecosystem partners across Canada. We position our offices in both Vancouver and Toronto as portfolio hubs for founders who want to be headquartered in Canada, but want to take on the world. Most importantly, we spend time in all major Canadian startup ecosystems and have plans for unique events to bring our curated community closer together.

Every startup dreams about entering an unowned, wide-open market ... and subsequently dominating it. About a year ago, I met a couple of Aussies — Vincent and Niall — who saw a gaping hole in the world of personal finance and seized the opportunity to meet the unspoken needs of a huge demographic: People who want to be in control of their money but hate the complexity of planning and budgeting. They built Planwise — a forward-looking financial decision-making tool that shows you your future financial goals in the context of each other and your daily financial commitments.

If you look at the way people engage with their finances on a daily basis, you might think that we don't really care about our money. Unless we're about to run out of it, we want to do something with it, or it constrains us from doing something we want to do, we don't spend much time managing our finances. Most of the online tools that dominate the finance space are enterprise-centric solutions that require sign-ups and API calls to categorize your historical spend. Those tools confirm that you spend too much each month on coffee and beer (in case you didn't already know), but Planwise takes a different approach — one that focuses on the future.

Planwise is a tool that answers potentially complex financial questions quickly and clearly. "If I make one additional principal payment on my mortgage every year, what will my outstanding balance be in five years?" "How would would my long-term savings be affected if I moved to a nicer (and more expensive) apartment?" "How much money should I set aside every month if I want to travel to Europe next summer?" You shouldn't have to dig up your old accounting textbooks or call a CPA to get a grasp on your financial future:

One of the most significant differentiators for Planwise is that you can use the tool without signing up and without any identifiable information. You just launch Planwise, add relevant numbers, and immediately see the financial impact of scenarios like paying off debt, losing your job, or changing your expenses significantly. If you find Planwise useful and you want to keep your information in the system (so you don't have to enter it again), you can create an account to save your data by just providing your email address.

Planwise has been a SoftLayer customer since around August of last year, and I've gotten to work with them quite a bit via the Catalyst program. They built a remarkable hybrid infrastructure on SoftLayer's platform where they leverage dedicated hardware, cloud instances and cutting-edge DB deployments to scale their environment up and down as their usage demands. I'd also be remiss if I didn't give them a shout-out for evangelizing Catalyst to bring some other outstanding startups onboard. You've met one of those referred companies already (Bright Funds), and you'll probably hear about a few more soon.

Did you ever see The Beach with Leonardo DiCaprio? You know ... The one with a community of world-shunners that live in a paradisaical community on a beautiful white-sand beach. The people in that community were purists — altruistic types who believed in the possibilities of living a simple life based on community support of the individual and the individual's reciprocal support and dedication to the community. Recently, I walked into Hattery — a co-working space in SF — and found a similarly tight-knit community that immediately reminded me of that movie. Hattery is "off the radar" to a certain extent, and that's largely because the collaborative environment and culture are what drive the incredible group of entrepreneurs who work there. To be allowed in the co-working space, it seems like the prerequisites are endless passion and an ambitious vision, so I shouldn't be surprised that Bright Funds calls it home.

Bright Funds is a business that was created to provide users the ability to easily invest in complete solutions for the causes they care about. After signing on as a Catalyst partner, Bright Fund co-founders Ty Walrod and Rutul Davé invited me to lunch at the Hattery office, and I immediately accepted so I could learn more about what they are up to. Having been involved in the tech startup world for a while now, I knew that I'd be meeting two very special entrepreneurs with big hearts and even BIGGER tech startup street cred.

Rutul and Ty were not content with their user experience (UX) when it came to giving to charities and helping solve some of the world's biggest problems. They noticed that little effort had been invested in providing donors with tools to make the act of giving both enjoyable and highly effective, so they took action. Bright Funds was created to redefine and refocus the experience of "giving to charity" ... Giving shouldn't just involve going through the motions of transferring funds from our bank accounts. They built a new giving platform to be more intuitive, rewarding and enlightening, and they did an unbelievable job.

Think of the last time you had a great user experience: An interaction that was as enjoyable as it was effective. Aesthetics play a big role, and when those aesthetics make doing what you want to do easier and more satisfying, you've got an awesome UX. The best user experiences involve empowering users to make informed and intelligent choices by providing them what they need and getting out of the way. Often, UX is used for site design or application metrics, but Bright Funds took the concept and used it to create an elegant and simple business model:

Bright Funds was designed to create a giving experience with an intuitive flow in mind. Instead of just writing checks or handing over cash to a charity, the experience of giving through Bright Funds is interactive and didactic. You manage your giving like you would a mutual fund portfolio — you decide what percentage of your giving should go to which types of vetted and validated causes, and you get regular performance updates from charity. I want to help save the environment.I want to give clean water to all.I want to empower the underserved.I want to educate the world. You choose which causes you want to prioritize, and Bright Funds channels your giving to the most effective organizations serving the greatest needs in the world today.

Instead of focusing on individual nonprofits, you support causes and issues that matter most to you. In that sense, Bright Funds is a very unique approach to charitable giving, and it's a powerful force in making a difference. Visit Bright Funds for more information, and get started by building your own 'Impact Portfolio.' If you're curious about what mine looks like, check it out:

This is a startup series post about Bright Funds, a SoftLayer Catalyst Program participant.About Bright Funds:
Bright Funds is a better way to give. Individuals and employees at companies with gift matching programs create personalized giving portfolios and contribute to thoroughly researched funds of highly effective nonprofits, all working to address the greatest challenges of our time. In one platform, Bright Funds brings together the power of research, the reliability of a trusted financial service, and the convenience of a secure, cloud-based platform with centralized contributions, integrated matching, and simple tax reporting.

People often ask me why I enjoy working at SoftLayer, and that's a tough question to answer fully. I ALWAYS say that great people and great products (in that order) are some of the biggest reasons, and I explain how refreshing it is to work for a company that operates prioritizes "solving problems" over "selling." I share the SoftLayer "Innovate or Die" motto and talk about how radically the world of hosting is changing, and I get to brag about meeting some of the world's most interesting up-and-coming entrepreneurs and how I have the unique opportunity to help amazing startups grow into Internet powerhouses.

I'm the West Coast community development manager for Catalyst, so I get to tell the SoftLayer story to hundreds of entrepreneurs and startups every month at various meetups, demo days, incubator office hours and conferences. In turn, I get to hear the way those entrepreneurs and startups are changing the world. It's a pretty amazing gig. When I was chatting with a few of my colleagues recently, I realized that I'm in a pretty unique position ... Not everyone gets to hear these stories. I've decided that I owe it to my coworkers, our Catalyst participants and anyone else who will listen to write a semi-regular blog series about some of the cool businesses SoftLayer is helping.

Picking one Catalyst participant to feature for this first blog was a pretty challenging task. With the holidays upon us, one company I'm working closely with jumped out as the perfect candidate to feature in this "season of giving": GiveToBenefit.

GiveToBeneift (or G2B) is a social enterprise based in Philadelphia dedicated to helping non-profits receive high-quality goods from select suppliers through crowd-funding. G2B is unique among the startups in the Catalyst program in that it is a "double bottom line" company: It is designed to generate profit for its business while at the same time creating positive social impact.

Crowd-funding — raising money from the public via online donations — is a relatively new activity, but it has already become a HUGE market. In 2010, more than 38 million people gave $4.5 billion to causes online ... $4.5 BILLION dollars were donated online to fuel ideas and businesses. Chances are, you've heard of companies like Kickstarter and DonorsChoose, so instead of taking time to talk about the crowd-funding process, I can share how GiveToBenefit differs from those other platforms:

Serves Non-Profits Exclusively - GiveToBenefit works exclusively with non-profit companies. They look for non-profits who don't have the financial or human resources to do their own fundraising and who can benefit from the high-quality goods their suppliers provide.

Marketing and Strategy Assistance - GiveToBenefit actively helps the organization market the campaign. The G2B team is ready, willing and able to offer suggestions, answer questions and provide feedback throughout the process, and given the fact that many non-profits lack technology resources, they usually get very involved with each cause.

No Additional Donor Fees - An extremely important note to point out is that GiveToBenefit does not charge donors a fee for their contribution beyond the mandatory fee charged by the credit card processor. More of every the donated dollar goes to its intended cause. Your entire donation goes to the non-profit for a very specific reason. There's no question about whether your donation will go to what you hope for.

Building Connections with High-Quality Suppliers - GiveToBenefit found a way to elevate the role of the supplier of the goods that non-profits receive and use. Brands whose products promise to perform better and last longer than the items the charities have access to are featured. GiveToBenefit derives revenue from its relationships with these suppliers, and G2B uses part of the fee it charges the supplier to fund the marketing of the non-profit's online campaign.

The idea is to go beyond "doing good," to "doing better." I could go on and on about the innovate ways they're "discovering better ways to do good," but the best way to show off their platform would be to send you to the three campaigns they recently launched:

If you'd like to learn more about GiveToBenefit or if you think one of your favorite non-profits could benefit from a G2B campaign, let me know (jkrammes@softlayer.com), and I'll introduce you to G2B founder and visionary Dan Sossaman.

I was born and raised in Brockville, Ontario, and I've always been a proud Canadian. In 2000, I decided to leave my homeland to pursue career options south of the 49th parallel, so I became an active participant in Canada's so-called "brain drain." It's never easy starting over, but I felt that my options were limited in Canada and that I wouldn't find many opportunities to make an impact on a global stage.

Fast-forward to 2012. Early in the year, we were introduced to GrowLab — a leading Vancouver based accelerator — by our friends at East Side Games Studio. They seemed to have a lot of incredible stuff going on, so I planned an exploratory mission of sorts ... In June, I'd visit a few Canadian cities with an open mind to see what, if anything, had changed. With the Catalyst Program's amazing success in the US, I hoped we could hunt down one or two Canadian startups and accelerators to help out.

I was very pleasantly surprised at what I found: A vibrant, thriving Canadian community of entrepreneurs that seemed to match or exceed the startup activity I've seen in Silicon Valley, Boulder, Boston, New York, Amsterdam, Hong Kong, and Dubai. How times have changed! Investing in the Canadian startup scene was a no-brainer.

We'll enroll startups participating in those organizations into the Catalyst Program, and we'll provide infrastructure credits (for servers, storage and networking), executive mentoring, engineering resources and limited financial support. SoftLayer wants to become the de facto Infrastructure as a Service (IaaS) provider for Canadian startups and startups worldwide, so this is a huge first step onto the international stage. More importantly — and on a personal level — I'm excited that we get to help new companies in Canada make a global impact with us.

As a Canadian expat, having the opportunity to give something back means a great deal to me. I see an incredible opportunity to nurture and help some of these Canadian startups take flight. SoftLayer is still an entrepreneurial company at heart, and we have a unique perspective on what it takes to build and scale the next killer app or game, so we feel especially suited to the task.

One of the Canadian entrepreneurs we've been working with sent us this great video produced by the Vancouver-based GROW Conference about entrepreneurship, and it immediately resonated with me, so I wanted to be sure to include it in this post:

We've already started working with dozens entrepreneurs in Vancouver, Toronto, Hamilton and Waterloo who embody that video and have kindred spirits to my own. SoftLayer has a few Canadian ex-pats on our team, and as Catalyst moves into Canada officially, we're all extremely proud of our heritage and the opportunity we have to help.

Some have called our foray into the Canadian market an "international expansion" of sorts, I think of it more as a "coming home party."

In the startup world, the resources you have are almost as important as your vision and your ability to execute. That simple idea fueled the creation of Catalyst, and it's a big component of our incredible success. We're taking the complexity (and cost) out of the hosting decision for the coolest startups we meet, and by doing so, those startups have the freedom to focus on their applications. But that's only the beginning.

In addition to providing infrastructure, my team and I also try to introduce Catalyst participants to investors, incubators, accelerators and other startup founders. By building a strong network of experienced peers, entrepreneurs have a HUGE advantage as they're building their businesses. The difficulty in making those introductions is that it's such a labor-intensive process ... Or I guess I should say that it *was* a labor-intensive process. Then we found YouNoodle.

YouNoodle is an online network for entrepreneurs that was founded in 2010 in San Francisco, California. The 18-person startup is built to connect entrepreneurs with people, startups, competitions and groups based on what's relevant to each entrepreneur's mission. What the Catalyst team has been doing in a labor-intensive fashion, YouNoodle has automated and streamlined! We had to meet these folks.

We heard that YouNoodle was putting together a start-up crawl during one of their immersion programs — they bring international entrepreneurs to Silicon Valley to learn best practices and make connections in the US market — and we jumped at an opportunity to provide the beer and sandwiches at one of the stops. If you've ever worked at a startup before, you know that the way to an entrepreneur's heart is through his/her stomach, so we hoped it would be "love at first bite."

We chatted with the YouNoodle team, and they showed us the recently released 2.0 version of Podium, the SaaS platform they built to manage the selection process for entrepreneurial competitions and challenges from organizations like Start-Up Chile, The Next Web, Intel, NASA and seven out of the top ten universities around the world. Basically, Podium enables the most talented individuals and innovative startups to rise to the top and get the opportunities they deserve.

YouNoodle was an obvious fit for Catalyst, and Catalyst was an obvious fit for YouNoodle. Other Catalyst participants could join the thriving community of entrepreneurs that YouNoodle has built, and YouNoodle could take advantage of the power of SoftLayer's hosting platform. And by helping support YouNoodle, Catalyst gets to indirectly help even more entrepreneurs and startups ... Very "meta!"

Over the past two years, YouNoodle has managed over 400 competitions which have received entries from more than 28,000 entrepreneurs around the world. They're a key player in the acceleration of global entrepreneurship, and they share our vision of breaking down the geographic barriers to innovation. And with the momentum they've got now, it's clear that they're just getting started.

If you have a second, head over to YouNoodle.com to check out the fresh, easy-to-use interface they launched to help users discover, get inspired by and connect with like-minded individuals on a global scale.

Not too long ago, SoftLayer was just 10 guys with a great idea to re-invent the hosting industry. The "Original 10" as we call them, took a huge chance by leaving the comfort and safety of their collective worlds to do something truly special. Those ten people pooled personal resources, mortgages, "Pay ya' back (someday maybe) friends and family" loans, credit cards and pretty much all they had to make this startup company dream come true: A truly automated system to provide a next-generation Infrastructure as a Service (IAAS) platform, the likes of which had never been seen.

So, when I say SoftLayer loves startups, it comes from many personal and collective experiences garnered as the startup we were not so long ago. We are, in my opinion (and at the risk of sounding grandiose), one of the great technology startup stories of the current tech era.

SoftLayer knows that startups are the lifeblood of our industry, no matter where or how they got their start. Facebook began in a dorm room in Boston and we all know how Apple got its start. If it hadn't been for the drive, determination, luck, timing and chutzpa of those startup founders, we wouldn't have the thriving technology economy we have today.

Today, startups have a real leg-up towards success. Incubators and Startup Accelerators are popping up all across the country and around the world. These groups are designed to not only help startups get funded, but to teach them how to be a "real" technology company, create products and services that people what to buy, and polish them up to a high-shine with the hopes that they will be attractive to investors everywhere.

This is where SoftLayer's Community Development team comes into play. This amazing and talented team works closely with startups at famous incubators like YCombinator and TechStars during their three-month formalized programs.

In addition to those formalize programs, we also support newer Incubator and Accelerator concepts like PeopleBrowsr Labs to help startups during the most critical time of their new lives. A startup's first year will usually make it or break it, and SoftLayer wants to help those companies power through by providing free hosting, best- and next-practices, scaling and "big data" advice, marketing and pretty much anything else we can share that could be of value to these young businesses.

As an example of the relationships we're building with startup accelerators around the world, one need look no further than what we've been doing with PeopleBrowsr Labs (PBL). PBL is a unique concept in the growing world of Startup Accelerators. In the heart of San Francisco's down town SOMA tech district, they provide a collaborative environment dedicated to "accelerating the Social Media Revolution."

I think focusing on Social Media startups is a smart move. Trying to create another Facebook would be a daunting task, and one that I'm not sure would be "worth it." A smarter thing is probably to figure out how to create value on top of that and other social media systems via new engagement platforms, games, and other features and functionalities that take advantage of the massive volume of social data that is created on established mediums every minute of every day. The startups who work in PBL have a huge advantage here. Not only do they get all of the SoftLayer goodness they could ask for, they also are allowed to tap in to PeopleBrowsr's 100+ Terabytes of social media data. PeopleBrowsr has almost every tweet ever tweeted, a data store of Facebook and Blog data and more that are all accessible to startups in the Labs via APIs. In today's "Social Evolution" this data is worth its weight in gold.

To get an idea of what a startup we're working with look like, you can check out ModX, recently featured in our Tech Partner Marketplace. ModX is a dynamic content management platform that allows users to build highly customizable websites through an easy-to-use template engine. They've added all the requisite tools for CMS and turned it into a fully capable web development platform upon which users can extend functionality, employ custom applications and do just about anything they can dream up.

We gave them advice and the robust infrastructure they needed in order to scale globally and support tens of thousands of users. There are some really big new things coming soon from these guys, so stay tuned...

In the coming weeks and months, we will be starting a new feature here on the InnerLayer Blog. We'll call it our "Startup Series," and it will be a showcase of some of the cool and interesting startups that are building their companies, their technologies and their brands on the SoftLayer Platform. We'll also take a more in-depth look at the Incubators and Accelerators themselves. This is just another way to give back what we've learned and hopefully "pay it forward" where we can. It's great to be at SoftLayer.